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Precursors to a New Philanthropy

A Fortune Too Large to Give Away?

At the dawn of the twentieth century, John D. Rockefeller was the richest man in the world. In a span of only 40 years, from his first job as a sixteen-year-old assistant bookkeeper in 1855 to his unofficial retirement as the head of Standard Oil in 1895, Rockefeller not only amassed a personal fortune but transformed American business practices forever. Even after his retirement, thanks to the oil shares he still owned and the demand for gasoline for newly invented automobiles, Rockefeller’s fortune ballooned even further, amounting to roughly a billion dollars by 1913, the year the Rockefeller Foundation (RF) was chartered.

Rockefeller was an ardent, lifelong Baptist, and in keeping with the tenets of his faith had committed himself to charitable giving as soon as he had any money to give. As he said later in life, “From the beginning, I was trained to work, to save, and to give.”[1] But by the 1890s, the sheer size of his fortune had turned the process of giving into an impossible chore, as he attempted to respond personally to thousands of individual appeals.

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Informal photograph of John D. Rockefeller Senior and Junior, 1921

Making Benevolence a Business

Two men stepped in to help Rockefeller re-envision his ad hoc charity. Together Frederick T. Gates and Rockefeller’s only son, John D. Rockefeller, Jr. (JDR Jr.) worked with Rockefeller to promote the evolution of large-scale philanthropy. They remade personal charity into an organized, institutional enterprise modeled on corporate business practices. This new philanthropy did not seek to provide direct relief to the diseased or impoverished, but instead looked to systematic, scientific principles to cure the “root causes” underlying both physical illness and social problems.

As Gates recalled later, “I gradually developed and introduced into all his charities the principle of scientific giving, and he found himself in no long time laying aside retail giving almost wholly, and entering safely and pleasurably into the field of wholesale philanthropy.”[2]

Progressive Era Values

The new “wholesale” philanthropy was steeped in the ethos of the Progressive era. Ironically, this ethos had evolved in response to the cataclysmic social changes brought about by the large-scale industrial capitalism that Rockefeller himself had helped to invent. Although Progressivism was infused with Protestant religious values, it also embraced secular methods, particularly the rationality of science and the quantitative analysis of the social sciences. Its essential tools were organization, data gathering, education, and demonstration – all techniques the new Rockefeller Foundation would zealously adopt.

The quick and unprecedented rise of industrial capitalism created both a vast underclass of unskilled workers and a new middle class that was educated, confident and more cosmopolitan. By the time of the RF’s founding, this middle class had become increasingly professionalized. It believed in the power of trained experts and created new systems of credentialing in many fields. While its attention to social ills aimed to offset the worst effects of big business, it accepted capitalism whole-heartedly. The professional class that would shape the RF’s new style of philanthropy aimed to apply the scientific, technical and organizational solutions born of industrial capitalism to public problems.

Frederick T. Gates Takes the Helm

Rockefeller first met Frederick T. Gates in 1888 when Gates, an ordained minister, was serving as the head of the American Baptist Education Society. Gates and others were working to convince Rockefeller to fund the creation of the University of Chicago, a gift that would eventually transform a defunct Baptist college into a modern, world-class university. Impressed with Gates’ abilities in business and philanthropy, Rockefeller hired Gates as his full-time personal philanthropic adviser in 1892. Later, Rockefeller credited Gates with being “the guiding genius in all our giving.”[3]

Gates moved quickly to consolidate Rockefeller’s haphazard gifts and began to develop the concepts that would guide his designs for all of the Rockefeller philanthropies: efficiency and a centralized system for the distribution of funds.

The first institution founded by Rockefeller that bore his name was the Rockefeller Institute for Medical Research (RIMR), in 1901. On a vacation in 1897, Gates had read William Osler’s thousand-page volume, Principles and Practice of Medicine, published in 1891. Concluding from it that the state of U.S. medicine -- and, hence disease control -- was sadly lagging, Gates envisioned a permanent institution where “qualified men” would be amply paid to conduct uninterrupted scientific research. The Institute, renamed The Rockefeller University in 1965, would become one of the pre-eminent centers of medical research worldwide and the site of major scientific breakthroughs.

Three themes evident in the RIMR pervade the Rockefeller philanthropies for most of the twentieth century: the commitment to open-ended scientific research, the idea that research values are universal values, and the conviction that disease is the root of all other ills -- physical, economic, mental, moral and social.

Predecessors in Education and in Health

JDR Jr. joined his father’s staff in 1897, but soon found that business was neither his passion nor his talent. The mark he made would instead be in developing the philanthropic side of the Rockefeller enterprises. Between 1900 and 1910, JDR Jr. and Gates lobbied Rockefeller in tandem, urging him to create a series of “great, corporate philanthropies,” the details of which could be worked out later. Many plans were proposed and discarded as the blueprint for what would ultimately become the Rockefeller Foundation slowly took shape.

JDR Jr.’s first work in organized philanthropy came about as the result of a 1900 train tour that was organized by Robert C. Ogden and that focused on African American education in the South. Impressed by what he saw at institutions including Hampton and Tuskegee, but dismayed by the lack of any other educational infrastructure, JDR Jr. encouraged his father to create the General Education Board (GEB) in 1903. While aiming ultimately to increase educational opportunity for African Americans, the organization quickly learned that the situation for Southern blacks could not be improved unless Southern whites were included in the program, so it set out to strengthen education “without distinction of sex, race, or creed.”[4]

The GEB exemplifies the Rockefeller enterprises’ concern with “root causes.” Although it aimed to improve education, it recognized that Southern farmers would be more inclined to support better schools if their livelihoods improved. In 1906, the GEB launched a wide-ranging and successful farm demonstration program. In 1909, the GEB recognized that hookworm disease, rampant throughout the South, was a serious obstacle to both education and productive farming, and Rockefeller established the Rockefeller Sanitary Commission (RSC), to eradicate hookworm through education, demonstration, and direct treatment.

These two predecessor philanthropies set in place what would become the RF’s fundamental methods: demonstration programs and infrastructure enhancement. The GEB demonstration program enabled the U.S. Department of Agriculture to establish a comprehensive system of county extension agents that long outlasted the direct involvement of the GEB. Likewise, the RSC’s campaign to eradicate hookworm disease helped instigate a county-based public health system in the U.S. that could take on other diseases. Time and again, the RF would continue the basic approaches honed by the GEB and RSC, establishing demonstration programs and using them to develop indigenous infrastructure that extended beyond the original problem.

Spurred by Success

The positive results of the RIMR, GEB, and RSC reinforced to Rockefeller the benefits of conducting philanthropic business on a large scale. These philanthropies also confirmed the effectiveness of entrusting the disposal of funds to professional staff governed by independent boards of trustees. In 1907, Rockefeller, Gates, JDR Jr. and family attorney Starr J. Murphy embarked on plans to launch an even broader, more general-purpose philanthropic entity. As they moved to obtain a corporate charter for this new Rockefeller Foundation, they anticipated little trouble. But the political winds had shifted and the charter struggle would prove to be far more onerous than anyone anticipated.